Wesley Batista, who has been at the helm of JBS since 2011, was detained under an arrest warrant against him and his younger brother Joesley Batista for suspected insider trading. The billionaires, both in their mid-40s, control 42 percent of JBS.

Their lawyer, Pierpaolo Bottini, called the allegationsunjust, absurd and regrettable. If convicted, both may be among the first people in Brazil to be jailed for insider trading.

Shares of So Paulo-based JBS reversed early losses, and rose as much as 1.5 percent in late morning trading as traders awaited details on the insider trading probe.

A police investigator said the insider trading allegations could hamper their plea deal, which they signed in May in relation to a massive corruption probe in Brazil.

The insider trading case involving JBS (JBSS3.SA) and the Batistas follows probes by markets watchdog CVM on trades both made before the plea deal was leaked by the press on May 17. The impact from the leak, which ensnared key politicians, led to Brazils worst market selloff in at least a decade.

Police investigators said the Batistas were aware of the market impact that their plea deals would have on the companys stock and the currency.

The investigators said both brothers created a strategy to protect their position in JBS while helping the company amass large foreign-currency positions ahead of the leak.

On May 18, the stock shed 9.7 percent, while the Brazilian real tumbled 8.2 percent - the biggest daily decline since Jan. 1999.

INSIDER TRADING PROBE

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